16 others get Approval-in-Principle …as 28 file fresh applications
The Federal Government, through the Nigerian Investment Promotion Commission (NIPC), has approved a tax holiday for eight more firms under its Pioneer Status Incentive (PSI) programme, New Telegraph has learnt. The approval granted in the third quarter of this year is to exempt the companies from paying taxes over the next three years. Aside from the eight firms, 16 other companies were also granted Approval- in- Principle, which is subject to the payment of application fees and only takes effect after the payment of such fees. A pioneer status incentive grants companies making investments in qualifying industries and products a tax holiday of three years from the payment of company income tax.
The three year tax holiday has the possibility of an extension for one or two additional years to enable the industry concerned to make a reasonable level of profit within its formative years. According to the Q3 PSI report just released by the NIPC, the new beneficiaries of the tax incentive include Belanova Apartment and Suites Limited, an hotel development company; Al- Wabel Rice Mill Limited, a rice milling firm; JMG Nigeria Limited, an electric generator company; Jigawa Rice Limited, also into rice milling; and DCP Cement Plc, a cement manufacturing company.
Others are Locodove Ventures Limited, which is into office building; Resource Improvement and Manufacturing Company Limited, edible oil processing company; and Okpella Cement Plc. NIPC further disclosed that the eight firms have so far invested a total of N328.6 billion into the country’s economy.
Indicating a long time of application processing, the NIPC report showed that one of the eight firms had applied for the tax holiday since 2018, four applied in 2019, one in 2020, while the remaining applied in early 2021. With the new approvals, NIPC said the total number of beneficiaries of the tax incentive as of September 30, 2021, stood at 35, while a total of 168 applications are pending. According to the Commission, the 35 companies have invested over N1 trillion in the economy and have over 6,000 employed staff.
The Commission disclosed that within the third quarter, 28 new firms applied for the PSI status in their respective industries. Aside from the new applicants, the Commission said five companies had also filed for an extension of their tax holiday within the period under review. In the same period, a tax holiday extension was granted to three companies.
These include Larfarge Africa Plc, a cement manufacturing company; Unicane Industries Limited, a manufacturer of Ethanol; and Confluence Metals Fabrication Company Limited. The extension is for another two years, according to NIPC. Meanwhile, the Federal Government had in March this year inaugurated a Joint Committee of staff of the NIPC and the Federal Inland Revenue Service (FIRS) on Pioneer Status Incentive (PSI). The Committee was set up to review the current guidelines for administration of the PSI, validate the cost of the incentive to Nigeria, and recommend changes to the qualification and administration.